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buying property
hey All, You are my go-to people for straight up answers - - thoughts are definitely appreciated on this! I've always leased studio space and have generally stayed with factory type settings. My most recent space is a second floor studio - 2000 square ft. 11 ft. ceilings.. great natural light and a great studio space... actually I really love it... what I don't love is the pawn shop that moved in and now has a door right next to mine and the catering business in the same building that leaves their garbage everywhere and keeps a dumpster near where I like to shoot (rock walls etc) I've asked the landlord (the one thing I've asked for in almost three years) if we could just move the dumpster away a little bit...but no... I hate leasing. It's money right out the window. And I do feel that when my lease is up in June that the LL's are going to either jack it way up or want to convert to apartments... just a gut feeling... With the market being what it is, what I'd like to do is buy a house. I can get a business loan and basically pay about as much as I'm paying now and it will be mine. Obviously, I'm looking at all the big features and being extremely careful as to hidden expenses and costs to own it... all of that aside, I'm trying to come to terms with the types of sessions I have (mainly headshots, some modeling, some seniors, some family) and the only thing that having a house might not lend itself to, would be a large 'studio' space (right now my studio room is 700 square ft., I doubt I'll find a room that big in a house situation) It would affect me for large families and dancers... I believe everything else would be fine since all of my studios prior to this have been much smaller... I think a house would be awesome though in the sense that every room can be different, lots of natural light niches, and the place itself would be an investment.... thoughts? especially from those who own already -- thanks! Julia Oct 01 12 05:58 am Link I own houses, but rent my studio (as you know). The house thing for a studio gets snarly regarding zoning. You must make sure that your house/studio is in an area that's zoned for business. I have thought about buying, but at least around here it would have to be a commercial building. Oct 01 12 06:56 am Link I think you need to be aware of general arguments like "renting is throwing money down the drain", and actually crunch the real numbers for options you are actually considering. Then you need to evaluate that difference and decide if it's worth your while. People often forget many ownership costs like increased utilities, closing costs, maintenance costs, higher taxes, etc. I lived in my first house for 7 years and despsite having a room mate for much of that time, when I crunched the numbers in the end, I figured it was about break even financially with where I'd have been had I continued renting. I shoot in my house, and like that I don't have to rent studio space, but combining personal and work space has it's downsides as well. Oct 01 12 07:02 am Link There are indeed some big advantages, and you do indeed need to crunch the numbers. I've done it both ways, and personally prefer owning the property, if for no other reason than that I can do what I want with it, when I want to do it. Zoning is an issue. Do make sure you make the offer to purchase contingent on getting zoning approval. Do also be aware that you'll need the cooperation of neighbors both when you buy and possibly also when you sell. I owned a place once where they were supportive when I bought, but new neighbors when I sold were not supportive of the business that wanted to buy, and I wound up selling for single family occupancy for much less than the business had been willing to pay. I park in front of those objecting neighbors sometimes, and tell people I consider I have thousands of dollars worth of free parking due for what I lost because they blocked the sale. Oct 01 12 07:57 am Link Julia Gerace wrote: If the larger families/dancers are a more rare situation, what about a house with 2-car garage? You may need to figure out something for heat (or cooling in summer) but it might give you even more options. Oct 01 12 08:25 am Link if your making good money out of your studio just now then yes i would transfer to an investment however if your just breaking even or your forecast isn't growth then keep renting.. you can get out of renting clauses allot easier than credit agreements when the shit hits the fan Oct 01 12 08:27 am Link thanks everyone! I'm definitely figuring out as many hidden expenses and foreseeable issues as possible... I think I'm on the right track regarding your concerns to look at, so that makes me feel better! Oct 01 12 11:07 am Link I have a large luxury loft as my home and studio and absolutely love it. This generally only works when u have no family or roommates to worry about. Talk with your accountant now to clearly undertand the financial impact. Oct 01 12 11:35 am Link Lots of thoughts come to mind, makes me realize you have a dilly of an issue to consider! Good luck, here are my thoughts: 1. I'd kill for 2,000 sq ft of space with 11-feet ceilings and good natural light. If you go the other route do NOT compromise ceiling height! In short you will be trading one set of issues for others. 2. I like a comfortable living room so it takes me an hour or two to move all my furniture for shoots at my house/studio. 3. Nationwide rents are going up and, of course real estate prices are still below their bubbled value of a few years ago in most areas. Sounds like you are at the point where rent equals (betters?) mortgage payments plus other costs, so given the premise that you believe the value of real estate will continue to rise, property becomes a smart investment. 4. On the other hand it would probably only take minutes each time to clean up the garbage and move the dumpster (temporarily) for the duration of the outdoor shoot. And this really isn't even an in-studio shot now, is it?! My guess is a patio or driveway at your new house is going to have many more issues, usually having to do with a noisy/inappropriate background. 5. Guessing your landlords intentions seems cavalier. Why not scout properties in the Spring and see what s/he really does in June. 6. Having said all that, something about your tone makes me want to tell a story, perhaps related: One of the best novels I've ever read ends, literally the last line of the book, with the adult protagonist flinging herself gleefully off a rope swing using the words, if I recall correctly, "into the unknown", like a child at risky play is how I read it. I read that book over 15 years ago and still that image comes to mind from time to time, joyfully as it did just now. Oct 01 12 12:09 pm Link toto - -very nice thoughts.. I'll try to get all the answers but I know I'll miss something... To clarify, the whole house will be for photography, we will not be living there as we already own a house and my husband does not want the business on our property. The mortgage could possibly be lower than what I'm paying now or just slightly higher.. plus some of these houses have separate apartments that I could also rent out to defray the costs... The LL right now has refused for a year to move the dumpster (it's one of those big heavy ones that you need a truck to move) and the garbage, we're talking at times rows of garbage lined up against the walls.. not my job to take care of other people's garbage, you know? I also believe that they're going to try and really up my rent when we come in for lease negotiations since they were convinced from the start that somehow I got them for way under what they deserve... It is a very tricky situation and though I know it might seem like the girl on the swing, I can assure you, I'm trying to be as absolutely safe and sure as I can! : ) Oct 03 12 09:36 am Link I'm a photographer, and a 18 year Realtor and Broker. Right now, buyers have some real advantages. Houses in foreclosure being offered at 70 percent of what they cost 4 years ago, coupled with 3.25 percent interest on a 30 year mortgage, make it very attractive. However, there are things you need to think about. You can't treat a home like a place of business. Most residential area have zoning restrictions against permanent signs, parking lots, large vehicles, etc. If you really want a storefront business, I would advise against buying a home. A home is also not a liquid asset. If your job transfers you every 2 years, don't buy a house. However, if you just want a studio space to shoot in, I can't think of a better time to do it. Just read your above answer, so want to add something. If you already have a primary residence, the 2nd home will be considered an investment, and you won't get the great mortgage rates I referenced above. Oct 03 12 10:28 am Link I leased for 7 years. Money just pissed away. Bought my first ever commercial property 4 years ago. Love it! Oct 03 12 10:31 am Link Hey Randy -- agreed! and zoning is definitely something I'm figuring out - though being on a main road with other businesses such as dentists and lawyers etc. I think makes it a little easier...though, again, not being 'owner occupied' I'm working with zoning and economic development people to figure it out... also, because I'd be buying through the business it wouldn't be a mortgage, I would have a business loan - so 25 years at about 4.5%... I think that's pretty reasonable though? thanks! Oct 04 12 03:36 am Link Rent is a deductible expense. Mortgage payments aren't. That changes the numbers you crunch. Oct 04 12 04:11 am Link Frozen Instant Imagery wrote: Sure. BUT. Oct 04 12 02:43 pm Link |
